1/x As we approach our long awaited🪟. It’s important to remember it’s NEVER an Easy Ride...Everything from the last 2 posts this week👇still applies, BUT...The strength of the NDX, the hugging & stretching of the 2 stdev of the 20 day, in the face of 46k lbs of JuneQ 4115 🍌’s
2/x from last week, the overextended retail sentiment & RSI’s, tells us the rally is hungry for more. We still expect the market to squeeze to ~3140 by Mon 4/12. @ 3140 is where things get interesting. w/the🪟open, this is where the market will begin to play🐔to shake the fragile
3/x paper hands & squeeze the last remaining 🌷‘s... So many are looking for this 3140 area to be a potential🔝, that my SPY-dey sense tells me we’ll potentially get a unimaginable stretch to a well deserved 420 SPY sometime before 4/20. My current est sees a potential 🎯
4/x of as high as 4240 in SPX by 4/16 morning. A rally this extreme would move the market away from the massive open interest of the 4115 supply & slide fixed strike IVol too low, given the recent RVol NTM the potential risks of rising yields, likely driving a wave of stock
5/x replacement & a call squeeze, which would be enough to finally take away Gary’s 🦍🍌’s & unlock the zoo cages...W/ Vanna 👸& Prince Charming 🦥 heading out on their monthly holiday, & w/Gary 🦍out of sorts, capital gains from last March-April moving to LT, taxes coming due in
6/x the coming month, & 🌷’s facing margin calls, it’ll finally be time...That’s not to say the decline couldn’t happen on 4/12 from 4140,...the🪟’ll be open, but it’s just to say that shorting it there w/out a hedge seems entirely too predictable...& Gary 🦍 will still likely be
7/7 too well FED in that area...given this, a blow off top in OpEx week seems like a higher prob in the dist than’s being priced. Come 4/12 the play’ll be to buy OTM calls hedged delta neutral, prepared for a wild trippy ride. 👀 fixed strike Vol, that’ll be the🪧. Good Luck!🍀🍀
3140=>4140
3140=>4140 😂
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1/x Everything from Monday’s 🥐 Crumbs👇still applies, So I’ll keep this short & jammy...The speed of the rally has been telling. Despite bullish sentiment, a rally beyond the 2stdev up of the 20 day, continued bear steepening, NDX beta adjusted weakness, 🚨RSI’s, this market has
2/x barely flinched... that tells me this market has more work to do on the upside still. This correction in time tells me that the rally was just a little ahead of schedule, but it seems unlikely that the market is going to let all of those late to the party enough time to catch
3/x up to the tour bus. ***4140 sits overhead & Vanna👸& charm 🦥 are slated to host an epic late Friday/Early Monday special edition of the Wheel of Fortune. Gary has gorged himself on🍌& is unlikely to be hungry until at least next week. Sky high ratings could distract
1/x As is usually the case with most long weekends, but especially so w/The Easter Bunny, IVol got the living daylights beat out of it... it didn’t help that Gary was already well FED coming into EOQ & got a dump trunk full of 🍌’s from the Zookeepers @ JPMorgan in the form of
2/x the 46k SPX JuneQ 4115 Calls mentioned last week... Dealers are stuck & Gary’s as fat as I’ve seen him in over a year. So it is, despite a 72 hr 80 PT SPX rally, no surprise that we are stuck here at 2 stdev up on the 20 day, playing 🐔w/ our long 🎯4024*** w/ a 1 week SPX
3/x straddle trading only $48. 4042.25 *** sits closely overhead as well. & despite every flow reason to hope for more upside & every macro reason to hope for mean reversion, w/👸Vanna & 🦥Charm well rested, this market sits between a 🪨 & an immovable force until 4/12.But don’t
1/x it’s synthetic Friday... I’ll keep it short and sweet. Everything from Tuesday still applies👇. Vanna’s 👸back, & Gary 🦍is as well FED as ever. There was a massive quarterly rolled trade, JuneQ 3175-3760 ps vs 4115 C 45,600x that traded in SPX today that only reinforced this
2/x despite all the drama & headlines, stay the course, & expect more digestion w/an upward bias. To be clear, normally, given +seasonality, the reopening & the technical strength of the last week, we’d normally expect much higher prices, but 1)momentum has been waning 2) the 🐻
3/x steepening of the yield curve continues to scream, now having reached the > the 2/10 spread has seen since 6/2015 3) the DXY is 🆙 1.2% in a week 4) There has been little to no retail call buying response to the new stimmy tendies due to the reopening (as predicted)...but now
1/x Despite an overwhelming number of fundamental reasons to be 🐻’ish, the 1-2 punch 🥊of 1)a well FED Gary & 2) an increasingly more involved Charm🦥, should continue to support the market until late 3/31st when Vanna should return, fresh from vacay & throwing haymakers...So,
2/x despite all the drama & headlines, stay the course, & expect more digestion... To be clear, normally, given +seasonality, the reopening & the technical strength of the last week, we would normally expect significantly higher prices, but 1)momentum has been waning 2)the NDX
3/x leadership hasn’t been able to regain any semblance of strength 3) the 🐻 steepening of the yield curve continues to scream, now having reached the > the 2/10 spread has seen since 6/2015 4) the DXY is 🆙 1.2% in a week 5) we are staring $136 bill in neg equity flows from
1/x Heck of a trip. On my ✈️ back, expect a full update tonight when I’m back at the desk... For the time being, if this little AM pullback is all that can be managed given, shockingly poor liquidity in a stable market amidst HF liquidation fears, & ‘significant’ bank losses.
2/x That should tell you something. Vanna is still not fully back until 3/31-4/1 but, as mentioned she just dialed in for a late 3/26 push. This is expected digestion following Friday’s steep ramp. Otherwise, systems look primed for a steady grind higher. Expect a bit of 🪓 to
3/x continue, but the next point of 🐔 is the 1.5 std dev up of the 20 day & the market has its 👀 set on playing there by the EOW. Gary is still in control, but should continue to loosen his grip, right as Vanna seems set to returns, so 4/1-4/12 could be a powerful 2 weeks...
1/x Precisely on schedule ⏰. The🪟of weakness opened & Oh what a feeling... The correction in price/time we’ve been waiting for has arrived. Our long NDX gamma calls @ the top hedged delta neutral were🥇, allowing us to scalp these monster moves & accumulate long deltas for a
2/x credit, as planned. We are 1/3 of the way to our full delta allocation & watching our 🕰 patiently w/plans to add w/ the passage of time/ price. The new game of 🐔 is likely to be played @ the 20 day tomorrow. We’ll be adding back more hard deltas there or @ the EOD, to get
3/x to 50% w/long gamma. Gary’s still very much in control i is n the SPX, as you can see overnight, This should lead to some cheap offered AM gamma in the NDX and some final AM charm support, before🦥 boards his✈️ to meet Vanna 👸@ the 🏖. As I’ve reiterated, the fat tail driven